B-165978, APR. 21, 1969

B-165978: Apr 21, 1969

Additional Materials:

Contact:

Edda Emmanuelli Perez
(202) 512-2853
EmmanuelliPerezE@gao.gov

 

Office of Public Affairs
(202) 512-4800
youngc1@gao.gov

SECRETARY: REFERENCE IS MADE TO LETTER ENGGC-N OF FEBRUARY 25. TOTAL BASE BID THEN WAS REQUESTED FOR ITEMS 1 THROUGH 9. IT IS REPORTED THAT THREE BIDS WERE RECEIVED AND OPENED ON NOVEMBER 26. PLUS OR MINUS (IN THE ORDER OF PRIORITY LISTED IN THE SCHEDULE) THOSE ADDITIVE OR DEDUCTIVE BID ITEMS PROVIDING THE MOST FEATURES OF THE WORK WITHIN THE FUNDS DETERMINED BY THE GOVERNMENT TO BE AVAILABLE BEFORE BIDS ARE OPENED. * * *" A NOTE AT THE BOTTOM OF THE INVITATION BID SCHEDULE SPECIFICALLY PROVIDED AS FOLLOWS: "/NOTE: BIDDER SHALL DELETE -/DEDUCT/- OR -/ADD/- AS APPROPRIATE FOR HIS BID. IF NOT DELETED THE PRICE WILL BE CONSIDERED ADDITIVE.'. TECTONICS WAS THE APPARENT LOW BIDDER WITH A TOTAL BASE BID PRICE OF $592.

B-165978, APR. 21, 1969

TO MR. SECRETARY:

REFERENCE IS MADE TO LETTER ENGGC-N OF FEBRUARY 25, 1969, FROM THE GENERAL COUNSEL, OFFICE OF THE CHIEF OF ENGINEERS, AND SUBSEQUENT CORRESPONDENCE DATED APRIL 3, 1969, FROM THE LOUISVILLE DISTRICT, CORPS OF ENGINEERS, REPORTING ON THE PROTEST OF TECTONICS, INC., AGAINST THE CANCELLATION OF INVITATION FOR BIDS NO. DACA27-69-B-0013, ISSUED BY THE LOUISVILLE DISTRICT, CORPS OF ENGINEERS, LOUISVILLE, KENTUCKY, AND THE READVERTISEMENT OF THE PROCUREMENT.

THE INVITATION, ISSUED ON OCTOBER 29, 1968, SOLICITED BIDS FOR THE CONSTRUCTION OF A MAINTENANCE DOCK, LARGE AIRCRAFT, UNITED STATES AIR FORCE RESERVES, GREATER PITTSBURGH AIRPORT, PENNSYLVANIA, WITH BIDS TO BE OPENED ON NOVEMBER 26, 1968. THE BID SCHEDULE CONSISTED OF ITEMS 1 THROUGH 8 AND A SUBTOTAL FOR SUCH ITEMS. ITEM 9 COVERED THE "REMOVAL OF EXISTING HANGAR AND STORAGE AT SITE (REMAINS GOVERNMENT PROPERTY).' TOTAL BASE BID THEN WAS REQUESTED FOR ITEMS 1 THROUGH 9. THE SCHEDULE ALSO CONTAINED AN ADDITIVE ALTERNATE ITEM AA-1, SNOW MELTING SYSTEM, AND A DEMOLITION ALTERNATE, ITEM 9A, FOR THE "REMOVAL OF EXISTING HANGAR (BECOMES CONTRACTOR PERTY).' IT IS REPORTED THAT THREE BIDS WERE RECEIVED AND OPENED ON NOVEMBER 26, 1968. PARAGRAPH 6 OF THE INVITATION ENTITLED "ADDITIVE OR DEDUCTIVE ITEMS" PROVIDED IN PART:

"THE LOW BIDDER FOR PURPOSES OF AWARD SHALL BE THE CONFORMING RESPONSIBLE BIDDER OFFERING THE LOW AGGREGATE AMOUNT FOR THE FIRST OR BASE BID ITEM, PLUS OR MINUS (IN THE ORDER OF PRIORITY LISTED IN THE SCHEDULE) THOSE ADDITIVE OR DEDUCTIVE BID ITEMS PROVIDING THE MOST FEATURES OF THE WORK WITHIN THE FUNDS DETERMINED BY THE GOVERNMENT TO BE AVAILABLE BEFORE BIDS ARE OPENED. * * *"

A NOTE AT THE BOTTOM OF THE INVITATION BID SCHEDULE SPECIFICALLY PROVIDED AS FOLLOWS:

"/NOTE: BIDDER SHALL DELETE -/DEDUCT/- OR -/ADD/- AS APPROPRIATE FOR HIS BID. IF NOT DELETED THE PRICE WILL BE CONSIDERED ADDITIVE.'

AFTER EVALUATION OF BIDS, TECTONICS WAS THE APPARENT LOW BIDDER WITH A TOTAL BASE BID PRICE OF $592,000 FOR ITEMS 1 THROUGH 9. HOWEVER, THE CONTRACTING OFFICER DETERMINED TO CANCEL THE INVITATION AND REJECT ALL BIDS PURSUANT TO ASPR 2-404.1 "DUE TO LACK OF CLARITY IN BIDDING DOCUMENTS.' TECTONICS PROTESTED AGAINST CANCELLATION OF THE INVITATION AND THE CONTRACTING OFFICER'S REASON FOR CANCELLATION AS BEING CONTRARY TO THE METHOD OF AWARD OUTLINED IN THE INVITATION FOR BIDS.

PARAGRAPHS 1.2.1 AND 1.2.2 OF THE SPECIFICATIONS READ AS FOLLOWS:

"1.2.1 BASE BID. UNDER THE BASE BID THE CONTRACTOR SHALL DEMOLISH THE HANGAR BUILDING, AND IN ADDITION TO THE ITEMS OF INSTALLED REAL PROPERTY THAT THE CONTRACTOR IS REQUIRED TO REMOVE AND SALVAGE FOR THE GOVERNMENT AS HEREINBEFORE SPECIFIED, THE FOLLOWING ADDITIONAL COMPONENTS SHALL BE REMOVED FOR SALVAGE, AND DISPOSED OF AS SPECIFIED HEREINAFTER: "STRUCTURAL STEEL BUILDING FRAMING MEMBERS; HANGAR DOORS AND OVERHEAD TRACK, PERSONNEL DOORS FROM HANGAR PROPER ONLY; INDOWS; AND ROOF VENTILATORS (2). "ALL OTHER COMPONENTS SHALL BECOME THE PROPERTY OF THE CONTRACTOR AND SHALL BE REMOVED FROM THE SITE, OR DISPOSED OF AS HEREINAFTER SPECIFIED.

"1.2.2 ALTERNATE BID. UNDER THE ALTERNATE BID THE ENTIRE HANGAR BUILDING SHALL BECOME THE PROPERTY OF THE CONTRACTOR AND SHALL BE REMOVED FROM THE SITE, OR DISPOSED OF AS HEREINAFTER SPECIFIED, EXCEPT FOR ITEMS OF INSTALLED REAL PROPERTY DESIGNATED HEREINBEFORE.'

THE CONTRACTING OFFICER STATES THAT IT WAS THE INTENT OF THE SPECIFICATIONS THAT AWARD WOULD BE MADE FOR EITHER ITEM 9 OR 9A SINCE BOTH ITEMS INCLUDED DEMOLITION OF THE HANGAR. ON THIS BASIS, IT IS STATED THAT THE GOVERNMENT ESTIMATE FOR ITEM 9A INDICATES "ADD $25,000" WHICH WAS THE ESTIMATED COST OF DEMOLISHING AND REMOVING THE HANGAR AS CONTRASTED WITH THE ESTIMATE OF $52,000 FOR ITEM 9 FOR DISASSEMBLING THE FRAMEWORK, MATCH MARKING AND STORING THE HANGAR COMPONENTS. BUT ALL BIDDERS ADHERED TO THE INSTRUCTIONS CONTAINED IN PARAGRAPH 6 OF THE INVITATION QUOTED ABOVE. IS ASSERTED BY THE CONTRACTING OFFICER THAT BECAUSE OF THE CONFUSION CAUSED BY THE INCONSISTENCY BETWEEN THE SPECIFICATIONS AND THE BID SCHEDULE, HE WAS UNABLE TO EVALUATE BIDS FOR THE WORK INCLUDED IN ITEM 9A. THEREFORE, ALL BIDS WERE REJECTED ON DECEMBER 26, 1968, FOR THE REASON STATED ABOVE. WE ARE ADVISED THAT A REVISED BID SCHEDULE IN THE READVERTISED INVITATION INCORPORATED THE REMOVAL OF THE EXISTING HANGAR (WITH COMPONENTS BECOMING CONTRACTOR'S PROPERTY) AS PART OF THE BASE BID WITHOUT ANY ALTERNATE FOR THIS DEMOLITION ITEM.

HOWEVER, WE DO NOT FEEL THAT THE INVITATION WAS AMBIGUOUS OR CONTAINED INCONSISTENT PROVISIONS AS TO HAVE WARRANTED ITS CANCELLATION UNDER THE CRITERIA ESTABLISHED BY ASPR 2-404.1 AND DECISIONS OF OUR OFFICE. IN OUR OPINION, ALL THE RESPONDING BIDDERS PROPERLY OFFERED DEDUCTIVE BIDS WITH RESPECT TO ITEM 9A. THESE RESPONSES AS TO THIS ITEM WERE REASONABLY CALLED FOR BY THE INVITATION ITSELF AND BY THE FORMAT OF THE SCHEDULE. IS REASONABLE TO CONCLUDE THAT A BIDDER WOULD OFFER A DEDUCTIVE BID FOR THE HANGAR REMOVAL IF IT WAS TO BECOME HIS PROPERTY WITH A RESULTING MONETARY VALUE TO THE BIDDER. IN THIS LIGHT, IT MAY BE SAID THAT THE GOVERNMENT WOULD NOT BE EXPECTED TO PAY AN INCREASE IN CONTRACT PRICE FOR REMOVAL OF THE HANGAR COUPLED WITH A LOSS OF ASSETS HAVING A DISCERNIBLE MONETARY VALUE.

WE, OF COURSE, RECOGNIZE THAT THE AUTHORITY VESTED IN THE CONTRACTING OFFICER TO REJECT ANY OR ALL BIDS AND READVERTISE IS EXTREMELY BROAD, AND ORDINARILY SUCH ACTION WILL NOT BE QUESTIONED BY OUR OFFICE. HOWEVER, WE CANNOT AGREE THAT A LACK OF CLARITY IN THE BIDDING DOCUMENTS SHOULD HAVE BEEN CITED AS A REASON FOR CANCELLATION WHEN BIDDERS WERE NOT MISLED. THE CANCELLATION OF INVITATION IS TO BE AVOIDED, WHERE POSSIBLE, BECAUSE OF THE OBVIOUS PREJUDICIAL EFFECT RESULTING FROM THE DISCLOSURE OF ALL BIDS. AS WAS STATED IN THE MASSMAN CONSTRUCTION CO. V UNITED STATES, 102 CT. CL. 699, 719,"TO HAVE A SET OF BIDS DISCARDED AFTER THEY ARE OPENED AND EACH BIDDER HAS LEARNED HIS COMPETITOR'S PRICE IS A SERIOUS MATTER, AND IT SHOULD NOT BE PERMITTED EXCEPT FOR COGENT REASONS.'

APPARENTLY THE ONLY REASON FOR READVERTISING IN THE INSTANT CASE WAS TO SUBSTITUTE ITEM 9A FOR ITEM 9 SO AS TO HAVE THE HANGAR COMPONENTS REMAIN THE CONTRACTOR'S PROPERTY AFTER DEMOLITION WITH THE EXPECTATION OF RECEIVING LOWER BIDS. HOWEVER, SUCH COULD HAVE BEEN ACCOMPLISHED UNDER THE ORIGINAL INVITATION WHICH, IN OUR VIEW, HAD BEEN CANCELED IMPROPERLY. SEE 40 COMP. GEN. 671; 43 ID. 537. SINCE THE WAGE RATES UNDER INVITATION NO. -0013 EXPIRED ON MARCH 5, 1969, REINSTATEMENT OF THAT INVITATION IS EFFECTIVELY PRECLUDED. SEE 41 COMP. GEN. 593. ALTHOUGH WE UNDERSTAND THAT THIS PROCUREMENT HAS BEEN READVERTISED FOR THE SECOND TIME WITH BID OPENING SCHEDULED FOR APRIL 16, 1969, IT IS SUGGESTED APPROPRIATE STEPS BE TAKEN TO PRECLUDE A RECURRENCE OF THIS TYPE OF PROTEST.